Pivotal up on no news

Pivotal up big on no news - maybe large investors taking a stake?

Also an interesting article on Pivotal highlighting the great opportunity in Pivotal Cloud Foundry (which I know from personal experience), but also highlighting the risk that Dell, or Silver Lake Partners could sell shares to raise money, lowering the share price.


Pivotal’s success in positioning itself as “the platform on which modern enterprise software will be built” is extremely attractive. The tools it offers on its open source based Cloud Foundry Platform-as-a-Service which enable developers to build applications that work across, and on, all major public clouds – Amazon Web Services, Google (NASDAQ:GOOG) (NASDAQ:GOOGL) Cloud Platform, Microsoft Azure – and company-owned private clouds are almost unrivaled. They are used by six of the 10 largest automobile manufacturers, seven of the top 10 banks, and half of the 10 largest insurance companies.

Pivotal would be an easy buy on its opening day buy if the price was right ($14-$15) and the possibilities of Silver Lake Partners, and maybe even Dell, flooding the market with shares over the next year weren’t so great. As it is, it’s probably worth waiting for that to happen and buying the stock at that time at a bargain. Pivotal’s Cloud Foundry has a solid chance of becoming the foundational platform on which modern applications are built and being based on open source software it presents an excellent alternative to anything AWS, Google Cloud Platform Microsoft and Oracle (NYSE:ORCL) have to offer.

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Bert H. says no.

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and being based on open source software it presents an excellent alternative to anything AWS, Google Cloud Platform Microsoft and Oracle (NYSE:ORCL) have to offer.

I retired 8 years ago so maybe things have changed. But, when I was working I was and enterprise architect at Fortune 50 company. One of responsibilities was to sit on a software standards board.

The company did not allow IT folks to download and install open source, demo, free s/w - ever. Any new s/w had to be first reviewed by the standards board and the vendor had to be cleared by the finance department. If it passed those initial reviews the s/w was installed in a test environment that came close to mirroring the production environment it was targeted for. If, and only if, it was found to play nicely with other s/w already in the environment and it did not impact the network performance in any significant way, it would come back to the standards board for a more comprehensive review.

The follow-up review examined offerings from competitors, considered if we already had a business relationship with the vendor and a host of other factors. If everything passed muster, the s/w was usually purchased for limited deployment. If it worked without disruption in production, it’s utilization may have increased over time if more seats were required.

Why all the caution? Two primary reasons. When PCs first came out, just about every manager could buy a few for his department with the budget he already had. And just about every manager did. We ended up with every conceivable brand and a tangled nightmare of incompatible s/w and file types. The other reason is that even 10 minutes of downtime in our mainline business systems would cost the company millions of dollars (not an exaggeration). We (IT) didn’t take chances on that.

Which brings me back to open source. We viewed all of it with a jaundiced eye. Who’s responsible for maintenance? What if there’s a mission critical bug, who’s going to respond to the emergency service call? The risks associated with open source were considered too great. Yes, we had some in the labs and a few other isolated environments (that didn’t need standards board approval), but when it came to mainline production, we wanted to buy s/w from a vendor that we could hold responsible 24x7x365.